Kalshi Raises $1.12 Billion in Private Equity Round, Now in Talks at $40 Billion Valuation

Kalshi filed paperwork with the Securities and Exchange Commission on August 25 showing it has sold $1.12 billion worth of equity in a private offering that opened April 3, according to the Form D notice. The filing lists a total offer size of roughly $1.5 billion, meaning about $380 million remains on the table. Seventy-one investors have bought in so far.

The notice was signed by CEO Tarek Mansour and names company directors Luana Lopes Lara, Alfred Lin, Michael Seibel, and Matt Huang, according to Coingabbar's review of the filing. No sales commissions or finder's fees were reported, which typically means the round was placed directly rather than shopped through outside brokers.

This raise runs parallel to, not instead of, a separate $1 billion Series F round Kalshi closed in May 2026 led by Coatue Management, with Sequoia Capital and Andreessen Horowitz also participating. That round valued Kalshi at $22 billion. Reports from The Information, cited by The Motley Fool, say Kalshi is now in talks with Sequoia and asset manager Wellington Management for another $750 million that would value the company at $40 billion, nearly double the May number in a matter of months.

The numbers behind the money

Kalshi's annualized trading volume hit $178 billion by April 2026, up from about $5 billion a year earlier, according to Crypto Briefing and Cryptonomist. Institutional trading volume rose 800% over the six months leading into April, with sports contracts driving much of that growth.

The company says it holds between 90% and 95% of the US prediction-market share and reports annualized revenue exceeding $2 billion. A separate industry report from Predicted, cited by The Motley Fool, put total notional volume across prediction markets at $111 billion in the second quarter of 2026, up from $80 billion in the first quarter.

Kalshi operates as a CFTC-regulated designated contract market, which is the regulatory clearance that competitors like Polymarket lack in the US. That distinction is why Robinhood has partnered with Kalshi to offer event contracts to its user base, and why event-contract revenue at Robinhood reportedly surpassed the company's crypto revenue for the first time in the second quarter, according to The Motley Fool.

Everyone wants in

The money chasing Kalshi isn't happening in a vacuum. Breitbart reported that Meta is developing an internal prediction-markets app called Arena, according to The New York Times, which cited two employees with knowledge of the project. Arena would initially run on a points system rather than real money, though Meta has not ruled out adding wagering later. Meta declined to comment on the project.

Meta tried this once before. The company launched a crowdsourced prediction app called Forecast in 2020 during the early pandemic and shut it down in 2022. This time the market looks different. Kalshi and Polymarket combined drew $50 billion in trades in 2025, a figure that had already topped $130 billion by sometime in 2026, according to Breitbart's sourcing on the Times report. FanDuel, DraftKings, and crypto exchange Gemini have all rolled out prediction-market products, and Trump Media & Technology Group has announced plans to enter the space as well.

What's driving the actual demand

There's a real case for why institutional money is piling into this sector instead of dismissing it as a betting fad. A Federal Reserve paper found that prediction markets did as good a job forecasting the federal funds rate as the Fed's own primary dealer survey, and did better than traditional methods at forecasting headline CPI inflation, according to The Motley Fool. Prediction markets also update continuously, while surveys only refresh every few weeks.

That said, the track record isn't clean. The Motley Fool also noted that prediction markets were significantly inaccurate in several closely watched congressional primaries and gubernatorial races recently, though the outlet cautioned there may not be enough historical data yet on smaller races to judge reliability.

The legal question nobody's answered yet

Breitbart flagged that the explosion in betting volume has drawn scrutiny from a bipartisan group of lawmakers, citing prior Breitbart reporting, because these platforms let people wager on virtually any outcome, creating obvious openings for insider-information abuse. No specific investigation, charge, or enforcement action tied to Kalshi has been detailed in current reporting. Whether Congress or the CFTC moves to tighten oversight as these markets scale into tens of billions of dollars in volume, and whether that oversight can keep pace with a company now negotiating a $40 billion valuation less than a year after being valued in the single-digit billions, is the open question hanging over the entire sector.

Kalshi's own long-term target, according to Crypto Briefing, is an IPO as early as 2027. If that timeline holds, the SEC filings investors are combing through right now are a preview of the disclosures a public listing would eventually force into the open anyway.